July 6, 2008 / 10:45 AM / 10 years ago

Saudi, Qatar border deal could unlock gas deal

RIYADH, July 6 (Reuters) - Saudi Arabia and Qatar have agreed to fix their maritime borders, Saudi media said on Sunday, in a move that could affect gas pipeline projects in the Gulf region.

Al-Riyadh daily reported that Interior Minister Prince Nayef bin Abdul-Aziz and Qatar’s Prime Minister and Foreign Minister Sheikh Hamad bin Jassim signed an agreement on Saturday to establish the sea borders between Saudi Arabia and Qatar, up to the international waters.

In 2006 Saudi Arabia was reported to have raised objections to a $3.5 billion gas pipeline project led by the UAE’s Dolphin Energy to supply Qatari gas to the United Arab Emirates, sending letters to minority partners France’s Total (TOTF.PA) and U.S. Occidental (OXY.N) questioning the pipeline’s route.

In 2005 Saudi media said Riyadh had protested to Qatar and the UAE over plans to build a bridge linking their two states, saying it would pass through Saudi territorial waters.

A gas pipeline project between Kuwait and Qatar had already been scrapped over Saudi objections.

Al-Riyadh said the ministers acted on the instructions of the two heads of state, King Abdullah and the Emir Hamad bin Khalifa. The deal was also carried by the official Saudi Press Agency.

The maritime border agreement follows a thawing of ties between the two countries that stretched back to 2002.

The territorial disputes among the three countries — Qatar, UAE and Saudi Arabia — are thought to have centred on land and waters of the Khawr al-Udayd area near Qatar and the Shaybah oilfield in the Empty Quarter where Saudi has all rights. (Reporting by Andrew Hammond; Editing by Thomas Atkins and Ibon Villelabeitia)

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